NEW YORK: Vital Energy and Northern Oil and Gas will jointly acquire US shale assets from private equity-owned Point Energy Partners for US$1.1bil, the companies say.
Vital will buy an 80% stake in the Point Energy assets, located in the Delaware patch of the Permian Basin, the heart of the United States shale industry that stretches across Texas and New Mexico. Northern will buy the remaining 20%, the companies said.
Reuters reported earlier last Sunday that Vital was in talks to buy Point Energy, in partnership with another company.
US energy producers have been on a buying spree in recent years as they aim to take advantage of higher commodity prices and lock up the best drilling sites on a bet demand for oil and gas will remain robust in the medium to long-term.
The assets Vital will buy in the Point deal cover around 16,300 net acres and produced about 30,000 barrels of oil equivalent per day (boepd) as of April, the company said. It expects to slow development after the deal closes and to reduce production to roughly half that level next quarter, it said.
The transaction is expected to close by the end of this quarter, Vital said.
Northern said it will buy Point’s assets that include 4,000 net acres primarily in Ward County, Texas, with recent production of over 4,500 boepd. Vital will operate these assets and Northern will contribute to developing them, the company said.
Tulsa, Oklahoma-based Vital Energy operates 266,000 net acres in both the Delaware and Midland portions of the Permian. — Reuters
